Amazon announces a $20 million investment in China's Yummy77. Photo Credit: Weibo.
Amazon announces a $20 million investment in China’s Yummy77. Photo Credit: Weibo.

Amazon has invested in a Shanghai-based food delivery service Yummy77.

An Amazon spokesman confirmed the investment to GeekWire today. TechNode was the first the deal based on details posted to Weibo.

The investment is right up Amazon’s alley considering its increased interest in grocery delivery in the U.S., however, geographically it is a little bit out of its comfort zone since it is the company’s first outside investment in China.

But the timing couldn’t be better. Chinese mega-tech conglomerate Alibaba is gearing up to stage what could be the largest technology IPO in the U.S. as soon as August. That means, Amazon’s Chinese peer in e-commerce, cloud and payments will be entering the U.S. in a significant way.

yummy77Although the Yummy77 investment is minuscule in comparison, it is one way that Amazon can keep an eye on the competition. Alibaba runs its own food service through sites, such as Taobao, and then there’s JD.com, the second-largest e-commerce site in China.

TechNode reports that the funding will allow Yummy77 to expand operations, including into new product categories. It is currently focused on fruit, seafood, eggs, meats and dairy products. In December, it claimed to have revenues of around $16 million, and one million registered users as of February.

Last year, Amazon started selling the Kindle in China and its cloud services. As recently as last month, Amazon said it was investing heavily in China, which included building out warehouses and keeping up a large product selection while maintaining low prices.

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Comments

  • http://www.sabbaticalist.blogspot.com Iv

    I’m not sure that Alibaba owns JD.. I could be wrong.

  • http://geekwire.com Tricia Duryee

    Thanks for catching, I’ve updated!

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